LIC Jeevan Saral

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LIC Jeevan Saral Plan

Life Insurance Corporation (LIC) of India is trusted name of the Indian insurance industry. The insurance plans of LIC are affordable and take care of the need of different insurance seekers. Certainly, several Indians depend upon the plans of LIC for providing financial security to their selves and their families. Keeping the trust of the Indian public, LIC time to time launches different policies and LIC – Jeevan Saral is one of them.

LIC Jeevan Saral is an endowment policy wherein the insured has to select the premium cost and mode of the payment of the premium. The plan offers monitory protection against the death of the policyholder and throughout plan’s term and provides up to 250 times of monthly premium. The maturity’s sum assured directly depends on the entry age of the insured in the plan and is paid on the survival of the insured at the policy term’s end. This plan is most recommended to the employees who require life insurance and tax savings with good insurance returns through Salary Saving Schemes (ECS).

This plan as well offers the 15 days free-look period and provides a lot of liquidity as it has the option of partial surrenders and flexible terms.

LIC Jeevan Saral Policy – Eligibility Criteria

The eligibility criteria to purchase Jeevan Saral plan are:

The entry age of the insured must be between 12 years to 60 years

The maximum maturity age is 70 years

The policy term can be between 10 years and 35 years

The minimum premium paid for this plan is as low as Rs.250/ month or Rs.3000 per year.

There is no limit on the maximum amount of premium that a policyholder can pay.

The mode of policy premium can be – yearly, half-yearly, quarterly, SSS, and ECS.

The loan on the policy is available after 3 years @ the rate of 9% per annum.

The riders of the term are also available.

The feature to surrender the policy is also available.

LIC Jeevan Saral Plan Features

LIC Jeevan Saral policy offers one of the best financial covers to the family of the insured when he/she expires. Another biggest advantage that one gets in case he/she survives the entire tenure of the policy is loyalty additions and maturity sum assured if the policy was in force for at least 10 years.

Loyalty Benefits: LIC Jeevan Saral is one of the with-profits plans wherein the insured participates in the profits of the LIC’s business. Consecutively, the insured gets the share of profits as loyalty additions and are considered as terminal bonuses. These loyalty benefits are payable along with the maturity and death benefits. The loyalty additions are most of the times payable from the 10th year onwards.

Premium: This life insurance policy provides multiple options of premium payment such as monthly payment, quarterly payment, semi-annually payment, an annual payment to the policyholders. The premiums automatically get deducted from the savings till the term of the policy.

Other Features of LIC Jeevan Saral Plan

The other feature that stands out Jeevan Saral policy from a lot of life insurance plans is the availability of ‘Riders’. There are two types of riders provided by this plan:

Accidental Death and Disability Rider: A rider that provides the sum assured to the family of the assured or his/her nominee after the accidental death of the insured or permanent disability or dismemberment.

Term Assurance Rider: The family of the insured or the nominee gets additional life insurance cover in the form of sum assured from this rider on the death of the policyholder.

Benefits of LIC Jeevan Saral Plan

The benefits provided by LIC Jeevan Saral policy are:

Death Benefits: The death benefit of 250 times of the monthly premium paid by the insured plus return of the paid premium (excluding the premium of the 1st year and premium of the rider/extra) plus loyalty additions (if any) is given to the family of the policyholder.

Maturity Benefits: The maturity benefit equivalent to the loyalty additions and sum assured is given, only if the policy was in force for at least 10 policy years.

Additional Benefit: Some features or benefits can be added to Jeevan Saral to enhance the protection and life cover of the insurance plan. However, additional benefits are available by paying some extra premium by the insured.

Guaranteed Surrender: An insured can surrender the insurance policy only after completion of three years. Here, the guaranteed surrender value is 30% of premium’s amount that is paid in total. This excludes the premium that is given for the first year and the extra payments are given for the rider benefits.

Special Surrender: In this case, 80% of the sum assured is given after the completion of three years, but not four years wherein all the premiums are paid. 90% of the sum assured is given after the completion of four years, however not five years with all the premiums paid. 100% of the sum assured is given, if the premium is paid for five years.

In the Situation of Surrender: In this case, the value of Special Surrender is given and is definitely greater than the Guaranteed Surrender Value, which is valid for the particular period during which the amount of the premiums are paid without fail.

The LIC Jeevan Saral provides the benefit of add-on rider as term insurance rider wherein the Rs. 1 Lakh to Rs.25 Lakh sum assured is given. Apart from this, the plan as well offers disability and accidental death benefits wherein the additional sum assured is provided to the nominee of the policyholder in the situation of the accidental death of the policyholder.

If the policyholder stops paying the premiums after 3 years of the policy, Jeevan Saral plan acquires the paid-up value for the sum assured that is reduced and the insurance policy is continued.

The facility of loan is also offered to the policyholders.

Premium Details of LIC Jeevan Saral Plan – Table Number 165:

Entry Age (As per last birthday)

35

Maturity Age (As per last birthday)

60

Policy Term (In Years)

25

Premium Amount (In Rs.)

4740/-

The frequency of Premium Paying

Annual

Mode of Premium Payment

Monthly, quarterly, half-yearly, yearly, and SSS

Details of Sum Assured on Death After the End of the Year – Table 165 of LIC Jeevan Saral Plan:

Year End of the Policy

Premium Paid Annually (in Rs.)

Guaranteed Sum Assured (in Rs.)

Death During the Policy

On Maturity or Surrender

1

4704

100000

0

2

9408

1048000

0

3

14112

109600

8099

4

18816

114400

12942

5

23520

119200

18660

10

47040

143200

43360

15

70560

167200

75200

20

94080

191200

106124

25

117600

215200

135296

As per the policy, some insurance returns are guaranteed whereas some are variable as per the policy.

Disclaimer: The total Sum specified under the guaranteed column of the table above can differ from the actual sum assured at the end of the year as it is dependent on the performance of the policy in future.

Illustration of LIC Jeevan Saral Plan:

For example: Let us understand it with an example of a healthy male of 35 years, who is a non-tobacco user and chooses an annual premium of Rs. 4704 and the term of the policy is 25 years.

@ 6% Loyalty

@ 10% Loyalty

Death Benefit

280,200

426,200

Maturity Benefit

200,296

346,296

Points to Remember:

The above-mentioned example is made for a non-smoker male or female, however, they are dependent on medical certificate, lifestyle, and occupation of that individual.

Maturity benefit is the amount that is equal to the assured amount at the end of the year.

The loyalty benefits are dependent on prospective benefits and do not have any guarantee.

The example is aimed to provide the feature of this plan and the flow of given benefits at various levels.

Sum Assured Details:

The details of sum assured with the below mentioned conditions are mentioned below:

Entry Age: 35 years

Premium payment mode: Yearly

Policy Term: 25 years

Annual premium amount: Rs.4740/-

Policy Year’s End

Premium Paid at the End of the Year

Guaranteed Amount Paid at the Year End on the Death (Rs.)

Situation 1: Amount Payable at Year End on Death (Rs.)

Situation 2: Amount Payable at Year End on Death (Rs.)

Situation 1: Amount Payable at Year End on Death (Rs.)

Situation 2: Amount Payable at the Year End on Death (Rs.)

1

4740

100000

0

0

100000

100000

2

9480

104800

0

0

104800

104800

3

14112

109600

0

0

109600

109600

5

23520

119200

0

0

119200

119200

6

28224

124000

0

0

124000

124000

7

39928

128800

0

0

128800

128800

8

37632

133600

0

0

133600

133600

9

42336

138400

0

0

138400

138400

10

47040

143200

7000

18000

150200

161200

15

70560

167200

13000

41000

180200

208200

20

94080

191200

30000

100000

221200

291200

25

117600

215200

65000

211000

280200

426200

Policy Year’s End

Total Paid Premium till the End of the Year

Guaranteed Payable Amount at Year End on Death (Rs.)

Situation 1: Payable Amount at Year End on Death (Rs.)

Situation 2: Payable Amount at the Year End on Death (Rs.)

Situation 1: Payable Amount at the Year End on Death (Rs.)

Situation 2: Payable Amount at the Year End on Death (Rs.)

1

4704

0

0

0

0

0

2

9408

0

0

0

0

0

3

14112

8099

0

0

8099

8099

4

18816

12942

0

0

12942

12942

5

23520

18660

0

0

18660

18660

6

28224

23180

0

0

23180

23180

7

32928

27856

0

0

27856

27856

8

37632

32744

0

0

32744

32744

9

42336

37892

0

0

37892

37892

10

47040

43360

7000

18000

50360

61360

15

70560

75200

13000

41000

88200

116200

20

94080

106124

30000

100000

136124

206124

25

117600

135296

65000

211000

200296

346296

Disclaimer: This example is given for a male/female, who is non –smoker who has standard working and life style conditions and does not have any medical issues.

Documents Required Buying LIC Jeevan Saral Plan

The insurance seeker needs to fill an application form with specific medical details with a document of address proof and other required KYC documents. For some specific cases, medical tests may be required which are dependent on the Sum Assured and the age of the person.

LIC Jeevan Saral Plan – Exclusions

If the insured commit suicide within one year of the policy issuance date, then the policy will be void and the LIC will not pay anything to his/her family members.

LIC Jeevan Saral – Maturity Calculator

The maturity sum is equivalent to Loyalty Addition + Maturity Sum Assured declared in the maturity year. Therefore, the Jeevan Saral plan evaluates the maturity’s sum assured as per the Age (at the time of policy purchase) one enters, Term and Premium, and adds the Loyalty Addition to provide the approximate value.

LIC Jeevan Saral FAQ’s

What happens when you stop making the payments of the premium?

Answer: If you stop making the payments of the premiums after three years of the policy term, then a paid-up amount is acquired in reduced sum assured, however, the policy is eligible to qualify for any additions in future even on regular basis.

Is the facility of loan against LIC Jeevan Saral Plan?

Answer: Yes, the facility of loan is provided in Jeevan Saral.

What will happen if I wish to surrender LIC Jeevan Saral Plan?

Answer: Well, in such a case, you will get the Guaranteed Surrender Value only after completion of three policy years. The Guaranteed Surrender Value is 30% of all the premiums that you have paid except the premium of the first year. For more information refer to the table provided above on this page.